Forrester Predicts AI Growth Will Strain Energy and Water by 2027
AI expansion is shifting the bottleneck from chips to physical infrastructure, forcing companies to absorb higher costs for power and land.
Key points
- Forrester forecasts that AI growth will strain energy and water resources by 2027, limiting data center expansion.
- Two countries are expected to introduce energy tariffs specifically for data center operators to manage grid costs.
- A Fortune 100 company is predicted to generate 100 MWh of power using repurposed electric vehicle batteries.
Forrester forecasts that the rapid expansion of artificial intelligence will create significant pressure on energy, water, and land resources by 2027. The research firm argues that the next phase of AI adoption will be limited less by software improvements and more by the physical capacity of electricity grids and water supplies.
This shift means that data center operators will face tougher constraints on location and cost. As demand from AI workloads intensifies, competition for scarce resources will force companies to account for the direct cost of power delivery and the regulatory hurdles associated with large-scale infrastructure projects.
Energy costs will drive geographic strategy
The firm predicts that at least two countries will introduce specific energy tariffs for data center operators. This move is intended to address the heavy burden placed on local electricity systems by new facilities.
Operators will increasingly be required to bear the costs of grid upgrades and reserved power capacity. Consequently, the economics of deploying AI will become heavily dependent on local grid maturity and energy contracts, rather than just access to computing hardware.
Community opposition shapes approval processes
Forrester expects community-impact reviews to become a standard requirement for approving new data centers. Public concern over noise, pollution, and rising utility bills is creating a tougher planning environment for developers.
Large facilities will need to demonstrate their economic and social benefits to win approval. This reflects a growing tension between the strategic value of digital infrastructure and the local footprint it creates.
Battery reuse enters corporate planning
Beyond new construction, resource pressure is pushing companies toward circular economy models. Forrester predicts that a major corporation will generate 100 megawatt-hours of power using repurposed electric vehicle batteries.
This approach would use retired batteries to support operations or buffer against grid disruptions. It signals a move toward reusing existing materials to enhance energy resilience in the face of supply chain risks.
